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Arizona Social Security Disability Blog

Friday, November 9, 2018

LTD Recipients May Be Shortchanging Themselves

Q: Should I file for SSDI if I have LTD benefits?

If you’re already receiving long-term disability (“LTD”) benefits, you may feel fortunate, but you may not be taking full advantage of your situation. And that can cost you. That’s why seeking advice from a skilled disability benefits attorney is wise as soon as you become disabled.

Most long-term disability insurance policies require claimants to file for Social Security disability benefits as well in order to collect under their LTD policy. But even if it isn’t required by your plan, there are several reasons why applying for Social Security disability benefits (“SSDI”) could be advantageous to those with LTD insurance benefits.

Social Security disability benefits are periodically adjusted based on inflation so SSDI recipients can expect to receive periodic cost-of-living adjustments in their benefits checks. But long-term disability benefits are generally not adjusted for inflation, so LTD recipients will receive the same monthly amount 10 years from now as they are receiving today—so it will not go as far in the future as it may today.

Social Security retirement and survivor’s benefits are based on the worker’s average earnings over a long period of time. SSDI entitlement “freezes a person’s Social Security earnings record”, so the time period during which they receive SSDI benefits “is not counted as the time the person is employed” and therefore does not negatively impact their lifetime average earnings for their retirement computation. But this isn’t the case for employer or insurance company LTD benefit payments where the chunk of time--months or years-- in which there are no earnings due to the disability is included in the retirement calculation and will have a corresponding negative impact on their retirement computation.

Hiring a disability benefits expert is also helpful in determining tax implications which are contingent upon how the long-term disability benefits policy premium was paid – – by the person or another source and whether through pre-tax or post tax dollars.

A disability benefits attorney can also help with healthcare issues like COBRA medical coverage and Medicare eligibility. They can also explain the vocational rehabilitation and return to work incentives available to SSDI benefits recipients.

Regardless of whether you have LTD benefits or qualify for SSDI, you are still facing life with less money than you were previously earning. A disability benefits expert can help maximize your overall compensation and benefits.

If you need assistance filing for disability benefits or have questions regarding LTD benefits, the disability experts at Roeschke Law can help. Contact us today for a free consultation.

From our offices in Phoenix, Tempe, and Tucson, we help disabled people and their families throughout Arizona in all aspects of disability law.

 


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